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Singapore Regulators Reject M-Flex Bid to Nix Acquisition

Regulators in Singapore have rejected Multi-Fineline Electronix Inc.’s bid to pull out of an acquisition of a sister company based there.

The Singapore Securities Industry Council recently denied Multi-Fineline’s request to withdraw its offer for MFS Technology Ltd.

Both Multi-Fineline, known as M-Flex, and MFS are owned by Singapore-based WBL Corp.

In March, M-Flex offered $500 million,about the same as its current market value,to buy MFS. Both companies make flexible circuit boards that go into wireless phones. Motorola Inc. is a big customer of both.

Soon after the deal was announced, MFS posted a slowdown in sales.

M-Flex sought to get out of the deal, arguing that if WBL forced the acquisition, it would “be breaching its fiduciary duties and obligations to M-Flex’s minority stockholders.”

In October, M-Flex filed suit against its parent company to try and stop the combination with MFS.

M-Flex also has sued a pair of hedge funds investors that want to see the deal go through.

The litigation could delay the U.S. Securities and Exchange Commission from declaring the offer’s registration statement by year’s end. That in turn could delay several preconditions to the deal.

If that were to happen, Singapore authorities then could permit M-Flex to withdraw its offer.

M-Flex said it is still studying its options.

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